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Forestry sector calls for government support -

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Forestry sector calls for government support

The World Today - Thursday, 13 November , 2008 12:26:00

ELEANOR HALL: The Federal Government's decision to give the car industry a green incentive has
prompted the forestry sector to make its own demands.

But rather than an injection of funds into the forestry industry, managers and the forestry unions
are asking the Federal Government for regulatory changes.

The forestry sector says it can boost Australia's climate credentials and recession-proof small
rural towns if it has the right support from the Government.

As Felicity Ogilvie reports from Hobart.

FELICITY OGILVIE: Unlike many of Australia's industries, the forest industry isn't taking a begging
bowl to the Government. The National Association of Forest Industries doesn't want cash to
revitalise the sector.

The organisation's chief executive, Allan Hansard, says if the Government can change the way the
industry is regulated, the private sector can deliver both profits and carbon storage.

ALLAN HANSARD: We are talking about $19-billion worth of new investment in rural and regional
Australia, 16,000 new jobs which is really important going into a time when people are talking
about high unemployment. We can actually create new jobs here.

But also on the environmental side, we must remember that by 2020 our industry can offset round
about 20 to 25 per cent of Australia's emission abatement target.

FELICITY OGILVIE: The Government is listening. Mr Hansard says the forest industry has been in
negotiations with Canberra since August.

The Forestry Union has also been lobbying. The CFMEU's Michael O'Connor says his workers have seen
the $6.2-billion promised to the car industry and they want their share of government support.

MICHAEL O'CONNOR: Where do we fit into this picture? Where is the support for our industry and I am
sure the Government is contemplating it but what we are saying is let's get on with it. Let's roll
up our sleeves.

Let's bring employers, the union, the Government together. Let's draw up a plan about how we can
value add more in this country. How we can export more. How we can have more import replacements
and let's get the economy ticking. Let's defend jobs, let's see some job growth in regional

FELICITY OGILVIE: The industry plan that's gone to the Government is almost 50 pages long. It
details new ways of taxing investors, using trees as carbon storage and the potential to turn wood
waste into electricity.

The forest industry's Allan Hansard says there is a potential for seven per cent of Australia's
power needs to be met by wood waste in 2020. But there's a catch - the forest industry needs the
Government to declare burning wood waste a green energy.

ALLAN HANSARD: At the moment the Government is working on the national renewable energy target
scheme which is pulling together what was called the old EMRIT schemes and also pulling together
the state renewable energy schemes into one and what we are asking the Government for is a
recognition of the use of wood waste in that scheme.

FELICITY OGILVIE: Allan Hansard wants the Government to change the tax rules to encourage more
long-term investment in the plantation industry. He says it takes 40 years for trees to grow big
enough to use as sawlogs but the current tax system rewards 20-year investments which favour
shorter term pulpwood plantations.

ALLAN HANSARD: We are not getting the investment in plantations that are for sawlogs, sawn timber
so we need to increase the investment there so we become less reliant on imports from overseas.

FELICITY OGILVIE: Judith Ajani is a forest economist at the Australian National University. She
agrees that there needs to be a new approach to the forest industry.

But Ms Ajani says there's also a need to treat native forest differently from plantations.

JUDITH AJANI: When we put the two resources into an industry policy, we get a mess basically
because we essentially are keeping on giving out subsidies and commercial incentives to the native
forest part of the industry which competes again the plantation part of the industry in most

And so we get an incoherent industry policy and that is essentially the path Australia has been
travelling now for many decades and we need to move out of that policy frame and look at an
industry policy based on processing plantation resources and a conservation policy, looking at what
native forests can do for the environment and carbon.

FELICITY OGILVIE: Australia's most controversial timber industry project has also been part of
forestry sector's lobbying. The union's Michael O'Connor says the Government has been asked to
support Gunns' plans to build Australia's biggest pulp mill in Tasmania.

MICHAEL O'CONNOR: We understand there is a process that is still being gone through at the moment
for the environmental assessment. We assume that it will be ticked off. We think it is best
practice environmentally this pulp mill and if it gets ticked off, the Government will support it.

FELICITY OGILVIE: Gunns' final federal approvals are due in January. The company is still trying to
get finance for the $2.2-billion project. A spokesman from the company says it hasn't asked the
Government for any financial support.

ELEANOR HALL: Felicity Ogilvie reporting.